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15% Of Spenders Using Their Credit Card Could Have Saved Money With A 0% Interest Offer

08 November 2014

15% of spenders using their credit card could have saved money with a 0% interest offer(1)

The credit card market has never been so competitive yet research(1) from Sainsbury’s Bank Credit Cards reveals that 15% of those making a big purchase with a credit card didn’t use one with 0% interest on purchases. Therefore, they may have ended up paying more than they needed to.

The research(1) reveals that the most popular big ticket items to be purchased using a credit card related to home improvements (69%). Other big purchases included a technological appliance such as a TV or a personal computer (18%), a fridge, freezer or other white goods (10%), and some form of furniture (11%). More than one in four (28%) paid for a holiday and 4% used their card to buy a car(1).

Sainsbury’s Bank Credit Cards estimates that an individual using a card with the market average APR of 18.9%(3) would spend an extra £268.36 paying back a £2,000 purchase over 18 months(4), compared to a 0% interest card.

Consumers have collectively spent over £90bn on big purchases worth over £500 on their credit cards in the past year, and almost three quarters of this (£66 billion) will be paid back within the duration of their interest-free period on purchases(5).

Simon Ranson, Head of Banking at Sainsbury’s Bank said: “If consumers are planning to make a big purchase, it is worth looking at all payment options available to ensure that they are getting the best possible deal. Using a credit card with no interest on purchases is a good way to spread the cost of a big purchase by making the costs more manageable, without having to pay extra.”

Encouragingly, the research(1) also shows that of those who made a large credit card purchase, 19% used their card specifically to take advantage of an interest free period on purchases, 56% did so for convenience and 39% to collect rewards(1). Sainsbury’s Bank Credit Cards says customers are becoming more aware of how to get the most out of their card by using the product benefits available more effectively.

A further 39% of ‘big ticket buyers’ specifically used their cards to take advantage of the extra protection offered to consumers when buying on a credit card through ‘Section 75’ of the consumer credit act(1).

Sainsbury’s Nectar Bonus Credit Card lets customers collect even more Nectar points when they shop at Sainsbury’s. Customers should remember to pay with their Sainsbury’s credit card and swipe their Nectar card or use it online. Its benefits include:

To keep the promotional rate customers must pay at least the minimum payment by the due date and stay within their credit limit.

– Ends –

For further information, please contact:

Emma Murphy / Phil Anderson

Citigate Dewe Rogerson

020 7282 1072 / 1031

 

Lorna Gilmour

Sainsbury’s Bank

0131 338 2863 / lorna.gilmour@sainsburysbank.co.uk

 

This press release is information for journalists only and is not intended to be a promotion to be acted upon by consumers.

Rates and information correct at date of issue.

 

Notes to editors:

(1)   Sainsbury’s Bank commissioned ICM to conduct research on its behalf. ICM research interviewed a nationally representative sample of 2035 GB adults aged 18+ via the online omnibus between the 22 – 25 August 2014.

(2)   When customers pay with their Sainsbury’s Nectar Bonus Credit Card and swipe their Nectar card or use it online. Excludes Travel Money purchases.

Sainsbury’s Nectar Bonus Credit Card Nectar point conditions: 8 Nectar points are collected on each full £1 spent on each separate shopping and fuel transaction at Sainsbury’s. 8 points offer valid for 3 months from account opening & on qualifying spending up to a value of £1,000 per month; beyond which 2 Nectar points are collected on each full £1 of each separate shopping and fuel transaction at Sainsbury’s. Customers also earn 1 Nectar point per litre of fuel from Sainsbury’s. Excludes all bonus points offers and points from Sainsbury’s Telecoms and Energy, which will be treated as non-Sainsbury’s purchases. For non-Sainsbury’s purchases 1 Nectar point is earned on each full £5 of each separate transaction. Travel Money purchases are not eligible for points. Nectar points are awarded to you by Sainsbury’s Supermarkets Ltd and Sainsbury’s Bank plc, who reserve the right to alter or terminate the Nectar point offer at any time, but will give as much notice as is reasonably possible before doing so. Points may take up to six weeks to appear on your account. The Nectar loyalty programme is operated independently of Sainsbury’s Bank by Aimia Coalition Loyalty UK Ltd, and the collection and use of points is governed by the Nectar Collector Rules, which are set out in the registration pack and are also available on nectar.com Telephone calls are free from a landline only and may be recorded for security purposes and monitored under quality control procedures. Credit available subject to status to UK residents aged 18 or over from Sainsbury’s Bank plc, Pitreavie Business Park, Dunfermline, Fife KY99 4BS

(3)   Market average APR is 18.9%, as at 15th October 2014

(4)   Based on 18 months at market standard APR of 18.9%, a customer would pay £268.36 in interest if they paid down £2,000 over 18 in equal payments.

(5)   13,205,000 people have made a credit card purchase over £500, with a mean purchase value of £6,850. This gives a collective spend of £90,454,250,000. 73% of respondents said they have paid back or expected to pay back the whole amount within the duration of their interest-free period on purchases. 73% of £90,454,250,000 is £66,031,602,500.

 

 

Sainsbury’s Bank:
To view our latest press releases and product information, please visit the Sainsbury’s Bank online media centre at www.sainsburysbank.co.uk/media

Sainsbury’s was the first major British supermarket to open a bank, commencing trading in February 1997. Benefiting from a fantastic, trusted brand that enables us to combine the shopping experience with personal finance, Sainsbury’s Bank provides a range of quality products including insurances, credit cards, savings and loans. Our proposition is to make shopping more rewarding by offering customers great products at fair prices, while consistently rewarding shoppers for their loyalty and being easy to do business with at all times. Our products consistently top best buy tables and regularly win awards for quality, price and service.

 

Sainsbury’s Bank plc. Registered Office, 33 Holborn, London EC1N 2HT (registered in England and Wales, no 3279730) is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (register no. 184514). Sainsbury’s Bank plc is covered by the Financial Services Compensation Scheme (FSCS).